Cost of Living in El Salvador
The cost of living in El Salvador is quite cheap, in comparison to other Central American countries like Costa Rica. Mercer ranked the capital city, San Salvador, at 199th to measure the cost of living for foreign nationals in 214 cities around the world.
Buying Real Estate
In general, the government of El Salvador allows foreign nationals to purchase real estate in the country. However, foreigners and Salvadoran nationals cannot own a piece of property that is more than 245 hectares. Furthermore, expats cannot purchase rural lands in El Salvador, except if it will be used for industrial purposes. Prospective real estate buyers in El Salvador are strictly advised to be extra cautious about property rights.
State-owned registry Instituto Libertad y Progreso registers all properties bought in El Salvador. Aside from clearly identifying the owner of a property, this kind of registry which is common in the Central American region is also the most secure way of guaranteeing ownership of real estate in El Salvador. More often than not, property owners do not need to purchase property insurance because the system of Instituto Libertad y Progreso is very accurate.
Once a foreign national has chosen a property that he wants to buy, a notary prepares and notarizes the sale agreement. Registration fee or “Derechos de RegistroporVenta de Inmuebles/Alcabala” will then be paid, which is 0.63% of the property price. Transfer of Real Estate Tax or “Impuesto de Transferencia de BienesRaices” should also be paid at 3% over the excess of $28,571.43. Then, the deed of the property will be submitted to the Registry office and to the Municipality. The entire property registering process takes about 18 to 32 days.
Property prices in El Salvador vary, depending on the size and location of a house, apartment, or condo. Apartments located in the city center ranges from $1,136 to $3,000 per square meter, while an apartment outside the city costs around $2,300 to $5,380 per square meter.
Since El Salvador is a very small country, the choices for rental accommodations are quite limited. Most of the time, foreign nationals choose to rent in San Salvador because this is where the center of life in El Salvador can be found. The price for a one-bedroom apartment outside the city center of El Salvador ranges from $200 to $500 a month, while a similar-sized one outside the city center costs around $100 to $250 a month. A three-bedroom apartment in the city center costs approximately $450 to $600 per month, and a similar-sized apartment outside the city ranges from $200 to $450 per month.
The price of basic utilities in El Salvador, like electricity, water, heating and garbage ranges from $58 to $120 a month for an 85m2 apartment. Cable or ADSL internet connection with unlimited data and speed of 6Mbps costs about $30 to $60 a month. One-minute local call costs via a prepaid mobile phone costs about $0.18.
Eating out at an inexpensive restaurant in El Salvador costs about $3 to $5, while a three-course meal for two people at a mid-range restaurant costs around $15 to $40. A combo meal at McDonald’s or a similar fast food chain costs approximately $5, and a regular cappuccino at a restaurant costs about $2. One liter of regular milk costs $1.29, a 1.5 liter of bottled water costs $0.85, a loaf of fresh white bread costs about $1.33, one kilogram of rice costs $1.14, a dozen eggs cost $1.96, and one kilogram of local cheese costs $5.43. Domestic beer costs about $1.18, imported beer costs $2.10, and a bottle of mid-range wine costs approximately $8.
The price of gasoline in El Salvador is about 20% more than when filling up a tank in the United States. One liter of gasoline costs approximately $1.25. A one-way ticket in a local transport in El Salvador costs $0.30, while a regular monthly pass costs about $72. Taxi fares start at $5, with an additional $3 for every kilometer ride.
The income tax rate for employees in El Salvador is on a sliding scale, starting from 10% up to 30%. Estate or gift taxes are not imposed by the government, but properties may be subject to tax as ordinary taxpayers if they get income before assets are passed down to beneficiaries. Meanwhile, social security contributions are deducted monthly on employees’ income at a rate of 3%, residents or non-residents.
Expat Services in El Salvador
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